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Singapore overhauls bank reporting standards

By Ishika Mookerjee 05 Apr, 2018 at 02:20, Citywire Asia

After three years of consultation, the Monetary Authority of Singapore (MAS) has released new reporting standards for financial institutions, in what is being seen as the most sweeping transformation of regulatory reporting in the city-state.

Last week, the regulator made widespread changes to the MAS 610 and 1003 notices, which cover financial and statistical reporting for banks and merchant banks.

As a result, the data points for regulatory reporting by banks have increased by 8000% to over 300,000 across 60 forms, to be filed on a monthly, quarterly, semi-annual or yearly basis.

The Singapore regulator has given an implementation period of 24 months, requiring institutions to be fully compliant by 31 March 2020.

Following that, institutions will have to submit both the current and revised MAS 610 and 1003 reports between April and September 2020. The revised notices will take effect on 1 October 2020.

One of the biggest changes has been the decision to remove the division between the domestic business unit (DBU) and Asian currency unit (ACU) at banks.

Until now, banks were required to maintain two separate accounting and reporting units, where the DBU would focus on domestic operations denominated in Singapore dollars and the ACU would handle operations in foreign currency.

With the revised notices, banks will no longer have to segregate the two. However, MAS has allowed banks to maintain two separate systems over the next two years if they are unable to merge the units within the implementation timeline.

Moreover, it has removed the requirement for banks to book only Singapore dollar transactions in the DBU book during the interim period to allow system changes.

More information is also being requested from private banking units, such as industries and residencies of clients and their businesses, noted Abraham Teo, global head of tax products & Asia-Pacific head of product management at reporting technology provider AxiomSL.

The process began in December 2014, when MAS first decided to consult the industry on proposed revisions to the notices. The first consultation ended on 5 February 2015 and was followed by a second consultation in February 2017, which received over 800 comments from 85 respondents.

Bank of Singapore, DBS, Credit Suisse and Julius Baer were among the respondents in the first round of consultation.

Earlier this year, nine banks in Singapore commissioned AxiomSL, together with PwC Singapore and Business Reporting-Advisory Group, to develop an open data taxonomy system to ease the burden of reporting under the revised notices.

The taxonomy, designed to standardise the interpretation of the new MAS requirements, is expected to be complete and available to all financial institutions by mid-2018.

Responding to the revised notices, Teo told Citywire Asia: ‘Working group meeting with banks are scheduled for mid-April. We are right on track on schedule.’

In the meantime, the Association of Banks of Singapore is establishing an industry group to monitor the implementation of the notices.

‘We observe that more of such regulatory changes can be expected in time to come, indicating that automation is the only way to handle the growing supervisory demands and complexity in the reporting regime,’ said Peter Tierney, CEO Asia-Pacific at AxiomSL.